Nike's job cuts surge as stocks tick up amid cost-cutting push
Nike is set to lay off over 700 employees at its headquarters in Oregon, an announcement that surprisingly led to an uptick in its stock value. Additionally, the company has disclosed plans to reduce its global workforce by approximately 2 percent this year.
9:17 AM EDT, April 22, 2024
The decision to lay off about 740 staff members from its Oregon headquarters was detailed in a letter released on Friday, aligning with Nike's broader initiative to trim expenses. This move comes in the wake of a forecasted revenue dip for the first half of fiscal year 2025, as reported by Reuters.
Second phase of layoffs
Michele Adams, Nike's Vice President of People Solutions, indicated in a notice mandated by law to state officials that the second phase of layoffs is scheduled to start by June 28 at the headquarters.
Following this announcement, there was a slight increase in Nike's share price during after-hours trading, though it's important to note that the shares have decreased by nearly 13 percent throughout the year.
In December, Nike unveiled a $2 billion cost-saving initiative expected to unfold over the next three years. By February, it confirmed plans to cut around 2 percent of its workforce, equating to more than 1600 jobs. As of May 31, 2023, the company's total employment stood at approximately 83,700 individuals.
According to Reuters, Nike predicted a slight decrease in revenue for the first half of fiscal year 2025 in March. The company plans to scale back on certain franchises as part of its cost-reduction strategy.
